Campbells Cash and Carry Pty Ltd v Selby
[2007] FMCA 1826
•9 October 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CAMPBELLS CASH & CARRY PTY LTD v SELBY | [2007] FMCA 1826 |
| BANKRUPTCY – Application for sequestration order – where respondent alleged fraud against him – where alleged perpetrator of fraud not available for cross-examination – whether requirements of s.52 Bankruptcy Act 1966 met. |
| Bankruptcy Act 1966, s.52 |
| Applicant: | CAMPBELLS CASH & CARRY PTY LTD ACN 000 226 399 |
| Respondent: | MARK SELBY |
| File Number: | SYG 2025 of 2007 |
| Judgment of: | Raphael FM |
| Hearing date: | 9 October 2007 |
| Date of Last Submission: | 9 October 2007 |
| Delivered at: | Sydney |
| Delivered on: | 9 October 2007 |
REPRESENTATION
| Counsel for the Applicant: | Mr R.D. Marshall |
| Solicitors for the Applicant: | Aston Reid Lawyers Pty Ltd |
| Solicitors for the Respondent: | Hancocks Solicitors |
ORDERS
A Sequestration Order be made against the estate of MARK SELBY.
The Applicant Creditor’s costs (including reserved costs, if any) be taxed and paid from the estate of the Respondent Debtor in accordance with the Bankruptcy Act 1966.
The Court notes that the date of the bankruptcy is 9 October 2007.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG2025 of 2007
| CAMPBELLS CASH & CARRY PTY LTD |
Applicant
And
| MARK SELBY |
Respondent
REASONS FOR JUDGMENT
In this matter the applicant seeks a sequestration order against the respondent debtor. The applicant has provided me with all the formal requirements under s.52 of the Bankruptcy Act 1966. The debtor filed a Notice of Opposition on or about 10 August 2007 in which he indicated that he would be filing a motion to set aside the terms of settlement upon which the bankruptcy notice and creditor’s petition is based.
He says that a fraud was committed against him and that his signature on the terms of settlement was forced by one Steven Flelli. He also says that Mr Flelli is the person responsible for the debt.
Mr Dai, who appears on behalf of the debtor, has not informed me that any application to set aside the terms of settlement (by which I assume he means an application to set aside the judgment) has been made. In support of the very serious allegation of fraud, two affidavits have been filed: one by Mr Flelli, and one by the debtor. Mr Marshall for the creditor informs me that as soon as the affidavit of Mr Flelli was provided to his instructing solicitors in August 2007, a request was made that Mr Flelli appear for cross-examination. I am also informed that when the matter was last before the Registrar of this Court, the matter was put over until today so that this Mr Flelli could be subpoenaed by Mr Selby in order to appear. That has not happened and Mr Flelli is not here.
To the extent that Mr Dai wishes to adduce from that affidavit an admission by Mr Flelli that he forged the signature, I find it hard to see where such a suggestion might come from. I am told it comes from para.6 of the affidavit of Mr Flelli in these terms:
“I refer to Annexure B and say that I signed as a witness. I do not know and cannot recall the Respondent signing a letter. I provided Annexure B to Hancocks Solicitors who were acting for the Respondent at the relevant time.”
And also para.7:
“Annexed hereto and marked “C” is a true and accurate copy of a cheque dated 10 May 2005 payable to the Applicant. The payer's name was Hotelco Pty Limited in which I was a director.”
Mr Flelli admits further on that the cheque was signed by him. Given the serious nature of the allegations being made against Mr Flelli and the absence of any direct admission, and the prejudice the applicant would suffer if the affidavit was admitted, I am not prepared to have it read in this Court. Even if I was prepared to have it read in this court I would not say that I could find that it indicated on its face the forgery alleged.
The other affidavit of Mr Selby is more direct. In paras.6 to 10 he makes the statements that he did not sign the terms of settlement and had been told by Mr Flelli that Mr Flelli would take care of the debt. Whilst Mr Marshall is unable to point me to any evidence that a request was made of Mr Selby to appear for cross-examination, I am prepared to accept that it is inconceivable that given the nature of the allegations made he should not be here in order to respond to them, and for that reason I do not permit paras.6 to 10 of the affidavit to be read.
There is a judgment against Mr Selby. That judgment was obtained on 12 July 2006. If Mr Selby objected to being sued for a debt of Mr Flelli's he should have defended the proceedings. A bankruptcy notice was issued against him on 7 November 2006. If Mr Selby objected to the debt he should have sought to have the bankruptcy notice set aside and the judgment upon which it was based set aside but he did not. He waited until now to raise these matters with the Court; indeed with any court. I cannot be satisfied that there is any substance in them. The judgment was regularly obtained and until such time as it is set aside it should be capable of supporting the proceedings that are currently before me.
Mr Dai also argued that the applicant had not shown that the respondent was insolvent. Of course, it is not for the applicant to show that the debtor is insolvent where he has failed to comply with a bankruptcy notice, but I was interested to note that in that part of the affidavit of Mr Selby which I did allow to be read, he deposes to his financial position. In that deposition he advises the Court that his weekly wage is $350.00 after tax; his weekly expenses are $200.00; he has no assets and he has a credit card debt of $6000.00. He says that his family home is owned by his wife and she is paying the mortgage. I do not believe that those statements indicate the financial situation of a man who is solvent and I would, therefore, reject the suggestion that I should decline to make the sequestration order on the grounds contained in s.52(2)(a) of the Bankruptcy Act.
I am satisfied that the debtor committed the act of bankruptcy alleged in the petition as amended. I am satisfied with the proof of the other matters required by s.52 of the Bankruptcy Act. I make a sequestration order against the estate of Mark Selby. I order that the applicant creditor's costs (including any reserved costs) be taxed in accordance with the Federal Magistrates Court Bankruptcy Rules and paid from the estate of the respondent debtor in accordance with the Act. Under the bankruptcy regulations a copy of the sequestration order is to be given to the Official Receiver in Sydney within two days. The Court notes that the date of the act of bankruptcy is 12 March 2007. I note that a consent as trustee has been signed by Mark Julian Robinson and has been lodged with the Official Receiver in Sydney.
I certify that the preceding nine (9) paragraphs are a true copy of the reasons for judgment of Raphael FM
Associate:
Date: 1 November 2007
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